After surging around 750 points last week, benchmark BSE Sensex rallied further on Tuesday and it surpassed 29,000-mark in Wednesday’s trade on account of sustained inflows by foreign institutional investors and firm global cues. Overall, market sentiments turned positive in the recent past on dimming hopes of an interest-rate hike by the US Fed this month. Traders also got some encouragement from Prime Minister Narendra Modi’s statement that the country’s priority will be to work towards trade facilitation agreement (TFA) for services, a move that will help in movement of professionals. Some support also came with report that foreign institutional investors were net buyers in Indian equities worth Rs 1,439 crore on Tuesday, as per provisional stock exchange data. Nifty crossed 8,900 mark on Tuesday for the first time since March 2015. On Tuesday, the index was trading 1.50 points up at 8944.50 in the late morning trade.
While being bullish on the market movements further, Chandan Taparia of Anand Rathi Financial Services said, “Nifty has formed a strong bullish candle on daily chart and momentum is all set to hit psychological 9,000 then its life-time high of 9,119-mark.”
With the help of various brokerage house we collated a list of 5 stocks which can give you good return in the ongoing bull market:
Zydus Wellness: Despite slowdown in the consumer discretionary categories, Zydus Wellness has maintained a leadership position in some of the niche categories, such as artificial sweetener (Sugar Free – over 93 per cent), Peel-off (Everyuth peel-off – 92 per cent) and Scrub (Everyuth Scrub – over 30 per cent) on the back of extensive branding-cum-marketing activities and timely re-launches in the key markets. Going ahead, the company is targeting to regain market share in the highly competitive Face Wash category with redefined strategies for its product (likely re-launch of brand) in the coming quarters. Sharekhan expects Zydus Wellness to add new products in its portfolio at regular intervals and improve the growth prospects in the long run. Further, consistent strong cash flows would help the company to strive for both, organic as well as inorganic initiatives in the coming years. The brokerage house has ‘Buy’ raging on Zydus Wellness with a target price of Rs 1,000.
Apollo Tyres: According to Sharekhan, Apollo Tyres is likely to register robust double-digit topline growth, led by demand improvement in both, the domestic as well as European operations. Further, better pricing power would enable Apollo Tyres to expand margins in the second half of the ongoing financial year 2016-17. The brokerage house has raised its FY2017 and FY2018 earnings estimates by 1 per cent and 3 per cent, respectively to factor in the margin improvement. Sharekhan is bullish on Apollo Tyres with a target price of Rs 245.
Sunteck Realty: According to a brokerage firm IndiaNivesh Securities, Sunteck Realty is a Mumbai focused developer having quality land banks with clean and clear titles, and premium positioning of its projects in every micro market that it caters. The company has a project portfolio of around 23 msf spread across 25 projects, with around 7 msf BUA under execution by end FY17. With marquee portfolio positioned at the top end of each micro market, Sunteck Realty has a strong visibility of future cash flows. With low debt and robust execution, it can achieve substantial value creation in the medium term. IndiaNivesh is positive on the real estate company’s future prospects and initiate coverage on Sunteck Realty with a ‘Buy’ rating of Rs 358.
Coal India: Motilal Oswal is bullish on Coal India shares with a target price of Rs 370. According to the brokerage house, recent policy change regarding bundling of FSA by the company or by the state may erode incentive income, which was around Rs 700 crore in 2015-16. The stock is trading at an EV of 7.2x FY18E EBITDA and valuation are looking attractive in the present market scenario.
MRPL: Centrum Broking remained ‘Buy’ on MRPL, with a revised target price of Rs 97. The company reported robust GRM of USD10.0 per barrel vs $ 8.2 per barrel in Q4FY16. However, on adjusting it for inventory gains, the core GRM was at $5.4 per barrel vs benchmark Singapore GRM of $5.0 per bbl. Core GRM could have been higher, but owing to state’s restriction on use of water led to momentary dip in throughput and lower distillate yield. Currently, MRPL has indicated a core GRM of $5 per bbl in Q2FY17 until August at a premium to benchmark Singapore GRM of around $4 per barrel, and it remains resilient owing to GRM accretive Petchem operations. According to the brokerage house, MRPL is a strong investment bet, with phase-III commissioned, integration of OMPL underway, positive turnaround in earnings and valuation discount to global peers, all of which cap the downside.